Cama protests tariff hike

Consumers Association of Malawi (Cama) executive director John Kapito has said Escom’s base tariff review application is not justified and will scare away investors.

Speaking during a public hearing meeting on the proposed review of electricity tariffs in Lilongwe, Kapito said the proposal is abusive.

He said: “The proposal is very unreasonable. It’s punitive and coming at a time when Malawi is experiencing higher costs on energy. Mind you, we have the automatic tariff adjustment formula, and not to mention the dwindling [in the value] of the kwacha. Already, Malawians are paying too much and for what? Escom services continue to be poor and the institution itself is very dirty.”

In September this year, the Electricity Supply Corporation of Malawi (Escom) submitted a 58 percent base tariff hike application to the Malawi Energy Regulatory Authority (Mera) from the initial 31 percent to be used in the 2014-2017calendar year.

Ironically, when our sister newspaper, Nation on Sunday, broke the news about the impending proposal to review the tariffs by 58 percent, Escom management issued a statement describing the story as a fabrication.

In his contribution, Kapito said while consumers appreciate the fact that Escom requires extensive capitalisation and investment on its power generation, transmission and distribution network, such a target cannot be achieved through overnight huge base tariff increases.

But Escom board chairperson Morgan Tembo said the proposed tariff is only a proposal and an entry point in terms of the processes that have been started.

Said Tembo: “We are not saying we want the whole percentage to be approved, but I can tell you we need something for Escom to work effectively and efficiently. Otherwise, our operations could be compromised if our requests are not met.”

On his part, Mera board chairperson Lyton Zinyemba said: “Our role is that of balancing the needs of utilities with respect to efficiency, viability and performance of energy undertakings and promoting the interests of consumers of energy with respect to energy prices and charges.”